brand-name consutlants are not set up to deliver value
The TOP Value Triangle™ defines the measurement of project success as the efficient and effective delivery of the desired business outcomes, benefits and value. The emphasis is on delivering measurable. lasting value to the business.
There are two main reasons why the major consultancies will NOT promote these measures to their clients.
- They don’t know how to
- They are making too much money from their clients’ inefficiencies (and therefore don't want to).
It is time to disrupt the consulting industry.
1 They don’t know how to
The major consultancies don't how to promote or deliver value. They are not thought leaders or innovators, they are followers. They rely on others to come up with ideas, and when new ideas get traction in the market they then follow as fast as they can.
The major consultancies avoid innovation as they find it too hard to sell to their clients. They only like to leverage proven models.
THINK — When did you see a new idea come from a brand-name consultancy?
If you look at their “research” it is mostly surveys of X hundred people around the world. They then collate the responses and produce a summary report as if it presents innovative insights. What such reports really are is the encapsulation of what consultants are accused of—they borrow your watch (views and insights) and then walk off with it (presenting your ideas as their insights).
Having watched a number of the major brands try to introduce a value-based project success measurement system, they fail each time as ‘value’ is just is not in their thinking. They will fall back on the established models (eg MSP) even when they’ve been shown to be ineffective.
At one of our clients, they invited the national managing partner of a major brand consultancy to participant in one of our workshops. When the participants were split into four groups, the group with the national managing partner in it performed massively worse than the other three groups. As we monitored this group it was clear the consulting managing partner, to whom the group were looking for guidance, had no idea how to contribute to a discussion on business outcomes, benefits and value—it was a foreign language to him.
2 They are making too much money from their clients’ inefficiencies
A highly capable client knows how to effectively manage consultants and get the best results from them. Therefore, the last thing a major consultancy wants is a capable, effective client to manage them. If they can keep their clients dependent on the consultancy they’ll make more money (which is the name of their game).
When put in charge of all consultancy assignments in a bank, I got rid of more than 60% of the consultancies in the first month by asking them to, within 30 minutes, give me a written, signed-off definition of exactly what they were there to deliver. Most could not provide any definition and were immediately dismissed – saving millions in monthly consulting fees.
THINK — How many of your existing consultants have clear, specific, measurable definitions of exactly what you want them to deliver that their performance can be measured against?
In private these consultancies will admit that ‘delivering real value to the client’ is secondary to ‘billings’. As long as they get and maintain their billings then what is being delivered to the client is deemed ‘okay’. As one managing partner observed, “We do our best work on our first and last days.”
Most the time organizations put consultants on a pedestal. This is dangerous and expensive as one senior manager found who had for years been the internal contact point for a major strategy consultancy. He suddenly realized that his organization was getting regurgitated ideas and ‘the standard answer’ when they thought they were paying for new insights and a competitive edge. His organization never used that consultancy again.
Another example. An executive brought in a brand name consultancy to review the structure and operation of a particular area of a utility. The consultants went to their internal ‘knowledge bank’ to seek the standard ‘best practice’ answer – which they presented to a subcommittee who informed them that their proposed structure was ‘illegal’. Treating that as ‘middle management obstructionism’ they continued and six weeks later presented the same solution to the CEO. He asked them what the subcommittee had told them. They framed the subcommittee’s response as resisting change and new ideas. “No,” said the CEO, “they were right; this is illegal; and I’m therefore not paying for any work since that meeting.”
THINK — Are your consultants delivering ideas and solutions specific to your needs or delivering some standard ‘best practice’ that may or may not suit your organization?
Disrupting the consulting industry
It is time to get away from limiting, self-serving, billings-focused consultants.
For the past 21 years TOP has reversed the focus of consulting to deliver value to the client both in terms of immediate results and in terms of client staff training and support. On most TOP assignments the client staff present the results, not the TOP facilitators.
While many organizations half-heartedly ask for ‘capability transfer’ when appointing consultants, they really don’t know how to measure this and the major consultancies are definitely not set up to deliver it (as it will undermine their own revenue model).
So, rather than attach ‘capability transfer’ to a consulting assignment we believe clients should commission a ‘capability transfer acceleration’ assignment that produces the desired results with and through the training and support of the internal staff (rather than abdicate the assignment to the consultants).
THINK — When did you last see a consultancy lead through training sessions to up-skill your internal staff to execute the assignment and deliver the results?
You need to shift the ‘value’ focus from what the consultancy can get out of you, the client, to what the consultants can deliver to the client.
We have proven that it is possible to get extraordinary results by training and supporting incumbent staff. Operating complexity can be halved; change can be implemented with less resistance; all of the promised benefits can be realized. These types of results have often been achieved while competitors have been using major consultancies at major cost to deliver measurably poorer results.
For example, the staff of one bank reduced the complexity of their mortgage processing business by 49% and implemented the mortgage processing system for $11 million. One of their competitors, using expensive consultants, reduced the complexity of their mortgage processes by 17% and then failed to implement the mortgage processing system after spending over $120 million.
THINK — How much could you save if you got consultants to train your own staff rather than do an inferior job themselves for significantly greater cost?
Doesn’t it make economic sense to disrupt the consulting industry? What do you think?